Did Trump’s trade policies ruin Uber’s IPO?
A month after Uber Technologies (UBER) went public and the stock plunged on its first trading day, the company’s chief executive, Dara Khosrowshahi, has revisited the lackluster IPO, saying it was spoiled by America’s trade war with China.
“The timing of our IPO was very much aligned with our president’s tariff wars, the same day. So I think we got caught up a bit in the market swirl,” Reuters quoted Khosrowshahi as saying at the Economic Club of Washington last week. But the executive sees a bright future for Uber as he reorganizes the company’s leadership structure.
Lyft also had a troubled debut
Uber went public on May 10. The company priced the IPO at $45, close to the bottom of its indicated price range of $44 to $50. Despite pricing the IPO near the bottom of the range, the stock fell 7.6% on its first trading day to close at $41.57. Lyft (LYFT), Uber’s ride-hailing rival, also had a disappointing debut. Lyft went public in late March, and the stock fell 12% on the first trading day.
But Pinterest (PINS), Zoom Video Communications (ZM), and Fiverr International (FVRR) had colorful debuts. Pinterest shares rose 28% on the first trading day even after the social media company priced its IPO above the indicated range. Zoom, a provider of online video communication for business clients, gained 72% on the first trading day. Pinterest and Zoom went public in April. Freelancing marketplace Fiverr, which went public last week (June 12), soared 90% on its debut even after pricing its IPO above the indicated range.
Uber suffered an operating loss of $1.0 billion in the first quarter.